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Newsletter

2004 2nd Edition (Other Editions)

1.The Wall Street Genius

Warren Buffet, a student of the Columbia Professor Benjamin Graham in the study of Investment, became the most remarkable person in the investment sector. Investing US$100 thirty-five years ago, the amount of money turned out to be US$30 Billion. The things he had done when investing which leads him to such a tremendous fortune are listed as follows:

  1. Analyzed the company's business operation condition instead of forecasting the entire economy
  2. Only made the purchase when the targeted stocks reached a really low price
  3. Invested on a few outstanding companies but not diversifying the investment
  4. Held the shares of those outstanding companies in long term (over 10 years)
  5. Made investment on shares which had lasting record of earning growth (over 10 years) rather than the ones which had a conceptual tendency to make a profit only.

2.Personal Risk Management

We keep on working everyday to pursue a better living. In Hong Kong, 60-70% of the population own life insurance policy, but those who own a plan which has protection on “continuation of drawing money when losing the ability to work” is far less than the former. It is probably because most of the people have not imagines how serious the financial situation would be affected when losing the ability to work. (On one hand they cannot make money, on the other hand they have to bear the huge cost of long term nursing fee) “Losing the ability to work” means that the Insured is unable to perform or engage in any gainful work, occupation or business for which he is reasonably qualified or fitted by knowledge training or experience. If you would like to be secured under this, what you need to do is to add a rider to your insurance policy, which can enable you the privilege of drawing money if unfortunate things happen. In case of accident or illness that leads oneself to be disabled, the insured amount of life insurance could be drawn every month for handling living expenses and additional spending, at the same time avoid creating a burden to the family members.

3.General Sense on Insurance

Once the Insured Person passes away, the assets which the family members can succeed in the shortest period of time is neither cash, properties nor shares, but the proceeds of the life insurance policy. If the sole beneficiary of the policy has already passed away, the proceeds amount will be treated as the Insured Person's legacy. The family members can only receive the proceeds after the completion of the probate process. Even if there are two beneficiaries (one of them living, the other deceased), the beneficiary who is still living could only get 50% of the proceeds, and the remaining 50% will be classified as the legacy. The Proceeds will be handed over to the legatee after the probate process.

Under this situation, the policyholder can inform the insurance company that he/she would like to dedicate the amount not yet succeeded to the living beneficiary or another contingency beneficiary, in order to skip the probate process.

4.Financial Planning

ecause of longer life expectancy, technological breakthrough and social improvement, people are demanding more for the quality of their living, children's education and life after retirement. The term “Financial Planning” becomes more prevalent. Through Financial Planning, you can make your dreams come true ─ sustaining or raising the living standard, supporting children's education, taking care of the family, accumulating wealth and a fruitful retirement life. The financial planning process is as follows: Firstly find the goals in life and financial affairs, followed by analyzing the current financial status. After drawing up financial strategies, choose the appropriate risk management strategy and investment vehicle. Lastly, evaluate the progress from time to time to see if it complies with the pre-set goals. Financial Planning involves education, retirement, savings and investment plan, in addition to risk and wealth management.